PUBLIC LAW 100-713—NOV. 23, 1988

102 STAT. 4793

in which—
"(A) 'A' is the amount the United States is entitled to recover;
"(B) *Z' is the sum of the amounts paid under this section to,
or on behalf of, the individual and the interest on such amounts
which would be payable if, at the time the amounts were paid,
they were loans bearing interest at the maximum legal prevail-
ing rate, as determined by the Treasurer of the United States;
"(C) *t' is the total number of months in the individual's
period of obligated service in accordance with subsection (f); and
"(D) V is the number of months of such period served by such
individual in accordance with this section.
Amounts not paid within such period shall be subject to collection
through deductions in Medicare payments pursuant to section 1892
of the Social Security Act.
"(3)(A) Any amount of damages which the United States is enti-
tled to recover under this subsection shall be paid to the United
States within the 1-year period beginning on the date of the breach
or such longer period beginning on such date as shall be specified by
the Secretary.
"(B) If damages described in subparagraph (A) are delinquent for 3
months, the Secretary shall, for the purpose of recovering such
damages—
"(i) utilize collection agencies contracted with by the Adminis-
trator of the General Services Administration; or
"(ii) enter into contracts for the recovery of such damages    Contracts.
with collection agencies selected by the Secretary.
"(C) Each contract for recovering damages pursuant to this Reports,
subsection shall provide that the contractor will, not less than once
each 6 months, submit to the Secretary a status report on the
success of the contractor in collecting such damages. Section 3718 of
title 31, United States Code, shall apply to any such contract to the
extent not inconsistent with this subsection.
"(m)(l) Any obligation of an individual under the Loan Repay-
ment Program for service or payment of damages shall be canceled
upon the death of the individual.
"(2) The Secretary shall by regulation provide for the partial or Regulations.
total waiver or suspension of any obligation of service or payment by
an individual under the Loan Repayment Program whenever
compliance by the individual is impossible or would involve extreme
hardship to the individual and if enforcement of such obligation
with respect to any individual would be unconscionable.
"(3) The Secretary may waive, in whole or in part, the rights of
the United States to recover amounts under this section in any case
of extreme hardship or other good cause shown, as determined by
the Secretary.
"(4) Any obligation of an individual under the Loan Repayment
Program for payment of damages may be released by a discharge in
bankruptcy under title 11 of the United States Code only if such
discharge is granted after the expiration of the 5-year period begin-
ning on the first date that payment of such damages is required, and
only if the bankruptcy court finds that nondischarge of the obliga-
tion would be unconscionable.
"(nXD By not later than the first of March of each year, the    Reports.
Secretary shall, beginning with fiscal year 1990, submit to the
Congress an annual report for the preceding fiscal year setting out—